Stubs for Tax Procedure

From The Shelf Project

Require withholding or at least Form 1099 reporting for all independent contractors who are present on the employer's premises for more than a threshhold number of days or hours or whatever it takes to reduce pressure on the employee/independent contractor question.

Require a Form 1099 for corporations as well as unincorporated independent contractors.

Make the presumptive penalty for failure to issue a 1099 a 20% tax on the unreported income, subject to mitigation by any amount upon which taxes were actually paid.

Place a 6 year statute of limitation on tax collection when a tax return was not filed as required, to the extent that the information was disclosed on information returns.

Require brokers to keep track of basis, transfer basis to new brokers, and report income on sales to the taxpayer and the IRS (per the National Taxpayer Advocate).

Allow the I.R.S. to obtain an order requiring a business to use a single bank account for all deposits for any entity with high percentages of income from sources that are often unreported and which have received an unfavorable audit in any amount more than x% of total tax liability.  These notices would be placed on a "hot list" which all tax preparers would be required to check, and would have to be posted to all employees with other employee notices.  Most civil law countries have such requirements in their basic business entity or business licensing statutes.